Which costs of inflation could the government reduce without reducing inflation?
A)shoeleather and menu costs
B)menu costs and relative price variability
C)unintended changes in tax liabilities and arbitrary redistributions of wealth
D)none of the above is correct.

Question

Quizplus · Accepted Answer

The government can adjust tax policies to prevent unintended changes in tax liabilities and address arbitrary redistributions of wealth without directly reducing inflation itself.

Which Costs of Inflation Could the Government Reduce Without Reducing